UPDATE 1-Quebec launches stimulus plan as election talk heats up

OTTAWA Oct 7 (Reuters) - The government of Quebec announced
a C$2 billion ($1.94 billion) stimulus package on Monday aimed
at creating jobs and jump-starting the French-speaking
province's sagging economy, which has underperformed the broader
Canadian economy this year.

Premier Pauline Marois announced the spending package, which
includes tax breaks and power subsidies for companies that
invest, amid speculation her separatist government might force a
snap election later this year in hopes of turning her minority
government into a majority.

But she denied any electoral ambitions and cited growth
downgrades by other major economies and the situation in the
United States, where a political deadlock has partially shut the
U.S. government and raised fears of an eventual debt default, as
a reminder of how "precarious" the external environment is.

"Our action has become more pressing because of the world
economic context," Marois said in a speech unveiling the
spending package. "The recovery has been slow to be felt
everywhere in the world."

"These are not policies that were written on the back of a
napkin in the expectation that there would be an election
tomorrow morning. Far from it," she added.

Quebec's economy contracted in recent months and job
creation has also disappointed, with the provincial unemployment
rate at 7.9 percent compared with the national average of 7.1
percent.

The government plans to eliminate its budget deficit in the
2013-14 fiscal year.
Continued...